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Duo Orchestrates $11M PPP Fraud Scheme

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A federal jury in Atlanta has handed down convictions to two individuals involved in a substantial fraud scheme. Teldrin Foster, 42, of Decatur, and Carla Jackson, 55, of Tucker, have been found guilty of orchestrating an elaborate scheme to siphon over $11 million from the Paycheck Protection Program (PPP), a critical component of the federal government’s effort to support businesses during the pandemic.

The case, which unfolded between April and August 2020, saw Foster and his co-conspirators submitting fraudulent PPP loan applications for 14 businesses, each seeking approximately $800,000 in relief funds. These applications falsely asserted the operational status of these businesses, their payroll expenses, and the number of employees, thereby exploiting the program’s intent to sustain legitimate businesses struggling due to the pandemic-induced economic downturn. The fraudulent nature of their operation was further cemented by the submission of fake IRS Form 941s to support their claims.

Jackson’s role in the scheme involved laundering the ill-gotten gains, a critical step in the conspirators’ efforts to obfuscate the origin and illicit usage of the funds. The sophistication of their methods points to a calculated attempt to undermine the integrity of federal relief efforts, highlighting a dark facet of the pandemic’s economic fallout.

The convictions carry severe penalties, with the defendants facing up to 20 years in prison for wire fraud and money laundering charges and up to 30 years for bank fraud and making false statements to a federally insured bank. These sentences, pending determination by a federal district court judge, underscore the gravity with which the justice system views such exploitation of emergency relief measures.

The diligent work of the Justice Department’s Criminal Division, the FBI, IRS-CI, and SBA-OIG in bringing these individuals to justice is a testament to the federal government’s commitment to protecting the integrity of its pandemic response efforts. The case was meticulously investigated and prosecuted, reflecting the collaborative effort to safeguard public funds and ensure their intended use for sustaining businesses and jobs in a time of unprecedented economic challenge.

For small business owners, this case serves as a stark reminder of the importance of compliance with federal relief program requirements. It highlights the need for vigilance against fraudulent activities that not only jeopardize the availability of critical funds but also tarnish the reputation of the programs designed to provide lifelines to legitimate businesses. The role of accurate and honest communication with financial institutions and adherence to legal and regulatory guidelines has never been more critical.

As the COVID-19 Fraud Enforcement Task Force continues its mission to combat pandemic-related fraud, businesses and individuals must recognize their responsibility in ensuring that relief efforts reach those truly in need. The convictions of Foster and Jackson not only represent a victory for justice but also serve as a cautionary tale for those contemplating exploiting the system, emphasizing the collective duty to uphold the principles of integrity and accountability in times of crisis.

Image: Envato Elements

This article, “Duo Orchestrates $11M PPP Fraud Scheme” was first published on Small Business Trends

Duo is convicted in a $11M PPP fraud scheme submitting fraudulent PPP loan applications for 14 businesses totaling around $800,000 each.Read MoreSmall Business NewsSmall Business Trends

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